Two Ways To Play: GE Losing Power
Strengthen your portfolio in good times and bad.
GE Shares Plummet
General Electric (GE) was another victim in yesterday's drubbing. According to the Wall Street Journal, the stock plunged to a 5-and-a-half-year low due to concerns over the value of assets held by GE Capital, a division which accounts for most of the company's borrowing and over one-third of its profit.
The costs of protecting $10 million in GE Capital bonds jumped 77% to $370,000. A spokesman said the spread on its credit default swaps, or CDS, rose more than other financial institutions because GE is part of an index that tracks these products. Investors weren't convinced and shares fell 8%.
From the Bull Pen: Bulls can turn their attention to Con Edison (ED). Note the relative performance. A pullback towards $42 could be interesting.
From the Bear Cave: We've talked about GE being a bearded financial, but the easy trade is over. Bears can eye its peer, Dover (DOV). A close below $45 could have the stock headed for the $40 strike.
Google Android to Hit Stores in October
The Wall Street Journal reports Deutsche Telekom's (DT) T-Mobile plans to begin selling the first smart phone using Google's (GOOG) new mobile software, Android, as early as next month. Other companies have hit delays but the T-Mobile phone is still on schedule.
Some are optimistic these phones will be able to take sales from rivals.
T-Mobile could unveil the phone as early as September 23rd and it may even hit stores by the end of October, but a price has yet to be determined. Todd mentioned Google Friday in his Random Thoughts.
From the Bull Pen: Can Google hold the $400 support level? Those bullish can set sell stops below that mark.
From the Bear Cave: Bears can eye Apple (AAPL) for a downside trade. The stock is now trading below $140 in the pre-market. Previous support is now resistance, and buy stops can be set above that level.
For more ideas in real time throughout the trading day, check out Minyanville's Buzz & Banter.
Quick Check Around the World
Asian trading closed with the Hang Seng -5.44%, Nikkei -4.95%, Sensex -0.09%, Taiwan -4.89% and Shanghai -4.47%.
A quick check across the pond finds the CAC -1.79%, DAX -1.68% and FTSE -3.09%
As of 8:30 a.m. EST, S&P Futures are trading -16 points to 1179 and Nasdaq futures are off -1 points to 1710.
A Look At Commodities
Commodities are lower. Crude oil is down 3.93 to 91.78, gold is +3 to 790.00. Silver is -0.055 to 11.020 and copper is -9.20 to 309.20.
The dollar index is lower -0.402 to 78.507.
On the Radar
8:30 Consumer Price Index (m/m): 0.0% cons.
8:30 Core CPI (m/m): 0.2% cons.
8:30 CPI (y/y): 5.6% cons.
8:30 Core CPI (y/y): 2.6% cons.
9:00 Net Long-term TIC Flows: $53.4 bln prior.
9:00 Total Net TIC Flows: $51.1 bln prior.
1:00 NAHB Housing Market Index: 16 cons.
2:15 FOMC Rate Decision: 2.00% cons.
5:00 ABC Consumer Confidence: -47 cons.
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Good luck today!
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